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Housing deficit: Exploring partnership options

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Housing deficit: Exploring partnership options

To meet the accommodation needs of citizens, government  is thinking outside the box by exploring Public Private Partnership (PPP) option. DAYO AYEYEMI reports

Moving further from efforts put in so far to bridge the nation’s housing deficit currently put at 17 million, the federal and state government as well as stakeholders in real estate sector are beginning to explore other options.

While some states are involved in direct  construction of houses, others, including the Federal Government, are entering  into partnership with the private sector to reduce accommodation deficit in  the country.

Exploring various opportunities inherent in Public Private Partnership (PPP) for housing and other infrastructure development, the Lagos State Government has developed a new framework aimed at enhancing private sector participation  in providing affordable housing units in the state.

PPP initiative

According to Housing Needs Assessment Survey prepared by TNS RMS Nigeria Limited, Lagos has 2.5 million housing deficit.

Also, the state  currently  needs at least 187,500 new homes over the next five years.

Disclosing plans by the Lagos State Government  to invest fresh N20 billion in affordable houses to residents under the Rent-to-Own policy, the state Commissioner for Housing, Mr. Gbolahan Lawal, hinted that  10 private  real estate developers had been engaged on PPP basis  to increase housing stock  in the state.

According to him,  making use of PPP initiative  in housing has  signaled the seriousness of the government to  combat accommodation challenges  in the state head-on.

Commenting to the development, President of Real Estate Developers Association of Nigeria (REDAN), Mr Ugochukwu Chime, stated that one of the  challenges facing the  housing sector was absence of construction finance.

Consequently, he drew the attention of the Federal Government, through the Ministry of Finance and its counterpart, Power, Works and Housing, on the need to collaborate with the private sector.

It is on record that the Federal Government, through its National Housing Programme, has engaged some developers on PPP basis to develop houses across the states of the federation.

Ogun  and Bauchi states as well as institutions are also exploring this initiative.

Sterling Bank example

While other banks  are reluctant in lending money to real estate developers, no thanks to the huge percentage of non-performing loans,   Sterling Bank has taken the bull by the horns, partnering the  developers of Sterling Court, a residential units, being  developed by OKB & Associates Limited.

Sterling Court is  a PPP project with Lagos State Government under Agboyi-Ketu Local Council Development Area in the metropolis.

The estate, which construction encompasses 40 blocks of 320 units, starting with 26 blocks of 116 units as first phase in 2017,  is located at Ajelogo Housing Scheme, Alapere, Lagos.

It consists of contemporary designed apartment buildings, modern terraces and duplexes aimed at meeting accommodation needs of medium-income earners.

Speaking on the project, Group Head, Non-Interest Banking, Sterling Bank Plc, Dr. Bashir Oshodi, said that the bank’s involvement as first client and financier of the  housing development was borne out of its culture of community engagement and promotion of a sustainable society by enriching lives.

According to Oshodi, the project will be of immense benefit to medium income families with satisfactory facilities provided at very moderate cost.

Estate facilities include parking space, security, tarred road network, water supply and good central sewage disposal system.

Oshodi said: “Apart from my personal goal, which is to use integral development approach to drive poverty reduction strategies especially in developing countries, Sterling Bank has strong passion for excellence and, no doubt, the developers, OKB & Associates Limited, is a progressive real estate development company driven by an energetic team with sole aim of providing one-stop construction solution to its clientele across the world with Nigeria as the foundation.

“Sterling Bank is a full service national commercial bank and high quality financial service provider committed to enhancing stakeholders’ value.”

Justifying the housing initiative, Chief Executive Officer, OKB & Associates, Mr. Owolabi Kola-Balogun, said that population growth in metropolitan Lagos had assumed a geometric proportion while the provision of urban infrastructure and housing to meet the demand has not been at commensurate level.

This mismatch, according to him, has resulted in acute shortage of housing to the teeming population with Lagos accounting for about five million deficit. This figure, he said, represented 31 per cent of the estimated national housing deficit of 17 million, hence  Sterling Court’s development.

“This figure is growing at an exponential rate and therefore, the urgent need to provide affordable mass housing to help cushion the effect on the demand for housing,” he stressed.

Kola-Balogun said that the  estate  would create a world adaptable to urban commercialisation where clients live life in style and learn to embrace life’s true pleasures within their budget range

He explained  that the houses’ foundation  involved both mechanical and traditional approaches where different foundation types are being employed to ensure structural stability of the superstructure.a

“These are cellular raft foundation, conventional raft and pad foundation,” he said.

According to him, design of the first phase encompassed three prototype buildings to enrich proposed homeowners with variety of options.

“These prototypes are eight blocks of apartment building with a total of 64 flats; eight blocks of terrace buildings with a total of 32 apartments; and 10  blocks of duplexes with a total of 20 apartments,” he said.

Last line

PPP in housing development is essential in all aspects, but the government  needs to  ease land acquisition, titling processes and charges, in addition to providing durable infrastructure.

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